The long-term goal of this study is to decipher the mechanism for decreased mitogenic response of liver during aging. In intact liver the induction of DNA synthesis requires initial switch from differentiated to proliferative mode. This capacitation is achieved by disruption of cell- cell contacts during different injury models, such as partial hepatectomy or collagenase perfusion. Capacitation is critical for growth response; however only a few fundamental aspects of this process are known now. Proliferative capacity of hepatocytes inversely correlates with the level of ceramide, a bioactive molecule that is involved in the onset of growth arrest and differentiation: Capacitation of hepatocytes by collagenase- induced digestion of hepatic biomatrix correlates with down-regulation of sphingomyelinase activity and decrease in the level of its product, ceramide. These changes proceed the induction of immediate early oncogenes that are hallmarks of hepatocyte capacitation. Conversely, plating of hepatocytes on matrix similar to the natural hepatic ECM, is associated with normal levels of ceramide and inability to respond to growth factors. The major goal of these studies is to test whether these observed relationships are truly causal. We will use both, in vivo and to vitro methods to test critically the hypothesis that (1) aging involves constitutive up-regulation of sphingolipid signal transduction pathway, leading to attenuation of injury-induced hepatocyte capacitation; and (2) down-regulation of sphingolipid signaling causes proliferative state of hepatocytes. In the first specific aim we will explore whether constitutive activation of sphingomyelinase in old animals interferes with the proper capacitation of hepatocytes by (I) comparing the inducibility of immediate early oncogenes and ability to downregulate sphingomyelinase activity during the collagenase treatment in young and old animals, and (ii) testing in vivo whether maintaining ceramide level high during the collagenase perfusion blocks the capacitation of hepatocytes. In the second specific aim we will test in vitro whether ceramide mediates the effects of ECM on hepatocytes capacity to grow. First, we will test whether ECM regulates ceramide level in hepatocytes. Further, we will investigate whether increases in cellular ceramide inhibit ability to grow and whether these changes down-regulate c-myc expression. These experiments will evaluate the role of ceramide and sphingomyelinase in hepatocytes capacitation and will provide the experimental grounds for future studies on the mechanism by which ceramide mediates the effects of ECM on ability of hepatocytes to undergo proliferation.